Political parties postpone final vote on Romania’s new Fiscal Code

The main political parties in Romania decided to postpone the final vote in the Parliament on the new and reviewed Fiscal Code for the beginning of September. The vote was initially supposed to take place in an extraordinary session of the Parliament this week (August 24-26). The president of the Social Democratic Party (PSD) Liviu Dragnea asked for the debate to be postponed for next week, so that the main political parties get to meet and have a final talk, on Thursday, before taking a political decision on this important matter. Last week, the main parties’ representatives had a technical discussion about the Fiscal Code after which they announced that the reviewed Fiscal Code will include a two-phase VAT rate cut: from 24% to 20% starting January 2016, and from 20% to 19% starting January 2017. They also announced that the elimination of the extra excise on fuel will be postponed to January 2017. The initial form of the Fiscal Code, which the Parliament approved in early-July, included the VAT rate cut from 24% to 19% starting January 2016, as well as several other significant tax cuts. President Klaus Iohannis didn’t promulgate it and asked the Parliament to review the amplitude of the tax cuts. Romania’s National Bank (BNR) and the International Monetary Fund (IMF) also spoke against the ample fiscal relaxation measures proposed by the Government, which would endanger Romania’s macroeconomic and budgetary balance. Romanian President, central bank governor oppose PM’s Fiscal Code The IMF warns that unrealistic fiscal relaxation could endanger Romania’s hard-earned macroeconomic stability Fiscal Council: Romanian authorities need to reconsider position on Fiscal Code Romania’s Foreign Investors Council supports new Fiscal Code editor@romania-insider.com